In order to give Micro, Small, and Medium Enterprises (MSMEs) in Ghana better access to funding, Zenith Bank (Ghana) and the African Guarantee Fund (AGF) have announced a strategic risk-sharing partnership. This partnership will specifically target green businesses and businesses run or led by women.
Acknowledging that the majority of MSMEs face difficulties obtaining loans because of inadequate collateral or a deficiency in credit history, this partnership opens up a range of financial services and products that are especially tailored to meet the particular requirements of these companies, promoting their expansion and prosperity.
AGF will offer partial guarantees on loans that Zenith Bank Ghana issues, lowering the bank’s risk and facilitating MSMEs’ access to capital by opening doors that they might have otherwise closed.
Henry Onwuzurigbo, Managing Director and Chief Executive Officer of Zenith Bank Ghana, stated during the signing ceremony held at the bank’s head office in Accra that the bank was cognizant of the significance of small and medium-sized enterprises and the difficulties they encounter in obtaining financing.
The collaboration, he continued, was in line with the bank’s conviction that banking is at its best when it directly affects companies and, by extension, the real economy.
Onwuzurigbo declared, “MSMEs are the backbone of the Ghanaian economy, and we are committed to providing them with the financial support they need to thrive.”
“We will be able to reach more businesses and help them reach their full potential thanks to our partnership with AGF, especially those that are committed to sustainability and are owned by women.”
Through its initial agreement with Zenith Bank Ghana, the African Guarantee Fund is leading the way in a historic collaboration to support SME lending activities in the nation. This partnership is a major step toward empowering the dynamic SME sector in Ghana and promoting economic growth.
“This partnership is a significant stride in our mission to drive sustainable economic development through our guarantee facilities to increase Zenith Bank’s financing of MSMEs in Ghana,” stated Bendjin Kpeglo, managing director of AGF West Africa.
The partnership makes use of the Affirmative Finance Action for Women in Africa (AFAWA) initiative of the African Development Bank (AfDB) to provide women-owned and women-led businesses with a customized guarantee facility called “AFAWA Guarantee for Growth.” Zenith Bank’s Z-Woman loan product, their value proposition to bridge the financial gap faced by WSMEs, will benefit greatly from this specialized guarantee.
After the ceremony, Eyerusalem Fasika, Country Manager of the African Development Bank’s Ghana Office, stated, “This new signature agreement illustrates the African Development Bank’s commitment, through the AFAWA initiative, to promote women’s economic empowerment and financial inclusion while addressing the gender financial gap in Ghana.”
“Zenith Bank will benefit from the AFAWA component of this transaction as it works to de-risk its portfolio of women-led businesses. We’re overjoyed to see increased financial institution support for AFAWA and its implementing partner, the African Guarantee Fund, to increase the availability of financing for female entrepreneurs in Ghana,” stated Fasika.
The partnership also acknowledges that sustainability is becoming more and more important. Increased funding supported by AGF’s Green Guarantee Facility will assist companies in environmentally conscious industries like eco-tourism, sustainable agriculture, and renewable energy, proving both organizations’ dedication to environmental sustainability.
In addition to providing financial assistance, Zenith Bank and AGF are dedicated to equipping MSMEs with the know-how and abilities required to grow their companies. Together, they will provide training sessions on sustainable business practices, financial literacy, and management. These workshops will give MSMEs the tools they need to successfully navigate the market, make wise decisions, and run their companies.
